Communications, the Media and Information Technology 403
Public Mobile Phone Service
The market for public mobile phone services is highly competitive in Hong Kong. At year-end, six firms were operating a total of 14 digital systems, serving a customer base of over 8 million. This represented an annual growth rate of 13 per cent. The penetration rate of public mobile phone services was about 118 per cent, one of the highest in the world.
In October 2001, the Government issued four 3G licences under an innovative royalty scheme. The Government also spearheaded the introduction of an open. network access requirement whereby 3G network operators are required to make available 30 per cent of their network capacity for interconnection to, or access by, non-affiliated Mobile Virtual Network Operators and/or content providers on a non- discriminatory basis. This will facilitate the development of innovative applications and services through effective competition. 3G services were launched in Hong Kong in January 2004. By the end of the year, there were three operators offering 3G services.
The existing licences for 2G mobile services will expire in 2005 and 2006. To facilitate long-term investment and business planning (including planning for any necessary transitional or migration arrangements) by industry participants before their existing licences expire, the Government conducted two rounds of consultation in August 2003 and March 2004 to collect views on the regulatory framework for mobile services after expiry of the existing 2G licences. Taking into account the views received, the Government announced its decisions in November 2004: In essence, the Government would offer new 15-year licences to nine existing 2G mobile networks and allow a three-year period for the operators of the remaining two mobile networks to migrate their customers to other networks.
External Telecommunications Services
Competition in the external telecommunications services market was introduced on January 1, 1999. On January 1, 2000, the external facilities market was also liberalised. An operator that brings in new submarine or overland cables, or uses non- cable-based means of transmission (primarily satellite) to provide external telecommunications facilities-based service may apply for a licence. At year-end, there were 19 licensees providing cable-based external telecommunications facilities and six providing non-cable based external telecommunications facilities. Competition in the external telecommunications services and facilities market has led to a significant drop in International Direct Dialling (IDD) call rates.
Satellite Communications
Two Hong Kong companies, APT Satellite Company Limited and Asia Satellite Telecommunications Company Limited (AsiaSat), hold licences under the Telecommunications Ordinance and the Outer Space Ordinance to operate and provide satellite communication services. At year-end, the two satellite companies were operating seven satellites.